Tagged: game theory

It is unarguable that transit is vastly more effective at moving large numbers of people per unit area than personal motor vehicles. As such, it might be reasonably assumed that increasing the transit capacity of a city would decrease motor vehicle congestion as users of the latter shifted towards the former, thus freeing scarce road space. Yet, to understand why this is so rarely the case, we must dig deeper into the root causes of transportation demand.

By prioritizing spatially efficient modes like transit, walking, and biking, the Tilikum Crossing is able to increase transportation capacity, and therefore potential economic activity, far more than an equivalently sized bridge built for private vehicle traffic, and without the negative impacts on the surrounding environment as well.

People like being stuck in traffic the way they like hearing nails against a chalk board; with the exception of a few masochistic individuals, it is universally loathed. If only the <Feds, State, County, City> would add another road no one would have to sit in this parking lot. Now of course one could imagine a number of logistical reasons to refute this fallacious line of reasoning: bottlenecking, merging delays, turning delays, signal delays, start-up delays and even further demand induced by the new connection, to name a few. While those are all certainly valid criticisms, what I intend to discuss here has nothing to do with with these more intuitive problems; there is a more fundamental problem rooted simply in mathematics and basic economic theory.

Conventional economic philosophy dictates that individuals rationally acting in their own self-interest would ultimately also benefit society as a whole– a sentiment well-captured by this panel from yesterday’s SMBC comic.

Saturday Morning Breakfast Cereal #2891. 2013-Feb-18.

That is, it was conventional until famed economist, mathematician, paranoid schizophrenic, Nobel laureate, and protagonist of the book and film, A Beautiful Mind, John Forbes Nash, forever changed the field with his concept of equilibrium in non-cooperative games. His concept became known as Nash equilibrium and went on to become a cornerstone of contemporary game theory. Continue reading →